After a final trip to London in December it was good to be back in the US for a quiet Christmas break and I hope all the members and friends of BAB were able to take some time out to recharge batteries. I have never been very good at switching off and inevitably I found myself wondering about what 2022 would bring for BAB and our members after the extraordinary events of the last two years. As we have all learned, trying to make predictions is impossible, but there are a few big issues that need to be addressed and where a change in thinking might be helpful.
First, we must get used to living with Covid-19 and especially when it comes to travel. We were pleased to see a gradual relaxation of travel restrictions during the second part of last year but many of these were reversed in December with the arrival of omicron.
The UK government seems now to be taking the most sensible approach as it dropped its pre-departure test for in-bound visitors on January 7th but surely it is time for all of these restrictions to be lifted. If you stop to think about it, the rules have become farcical; if the restrictions were intended to keep Covid from entering a country, they have completely failed and with the infection rates as high as they are what on earth difference does it make anyway! Meanwhile, business and leisure travelers are holding off from flying because of the jeopardy of being stuck overseas…it has to be time for a change.
Next, we need to see some progress on a range of trade issues that have gone unresolved for too long. In our annual Confidence Index study conducted with Bain & Company last summer, US investors were very positive about the UK as a destination for capital and employment but concerns about the UK-EU settlement persist. Work needs to be done to continue to iron out the wrinkles in the TCA and to find a solution to the Northern Ireland issues which recognizes both the fact that this is fully part of the UK and the concerns of the EU about the integrity of the single market. Our sense is that the more time passes the more likely we are to find an agreement as bruises heal.
Apparently somewhat connected, incredibly, is the fact that the US has agreed to lift the Section 232 tariffs on steel and aluminum imports from the EU but has not agreed to do so for the UK over concerns about Northern Ireland. BAB’s view was that the imposition of these tariffs on national security grounds was highly questionable in the first place and maintaining them on a partial basis shows that they are being used solely as political leverage. More broadly we will continue to push for progress on a US-UK trade agreement and for an agreement between the US, UK and EU on data transfers. The general view is a full trade agreement is unlikely, given the US domestic political agenda and the looming midterm elections, but it is likely that a majority in the House would support an agreement if it was presented to them. It is certainly still worth pushing.
The final issue that has been on my mind is the energy transition and its implications. You may have heard me raise concerns at our regular climate-related roundtables about the impact on consumers of higher energy prices and other price rises or limitations on what has become an expected way of life. Without careful handling there is real risk of a major backlash as people realize the full implications of a forced transition to net zero. There is also a clear risk that the US and UK (and EU) adopt very different approaches to the timeframe for this transition and the degree of compulsion. There is already a marked difference in the cost of energy between the US and most of Europe for businesses and consumers and this may get even wider as different approaches are pursued.
At BAB we are excited about the year ahead and have a full program of events lined up for the next few months with the continuation of our series on sustainability, financial services, DE&I, politics and economics and trade. You can see details of all upcoming events on our website here or just get in touch with your BAB representative to see what you might like to join.
We are also thrilled to confirm the Honorees for the 2022 Transatlantic Business Awards which will be held on May 19th at The Pierre Hotel in Manhattan. This year we will be recognizing the stunning career achievements of four outstanding individuals: Frank Brown, Managing Director and Chief Risk Officer at General Atlantic, Ann Cairns, Executive Vice-Chair at Mastercard and Global Chair of the 30% Club; Irene Dorner, former CEO HSBC North America, Chair of Taylor Wimpey and Control Risks; and Dame Karen Pierce DCMG, HM Ambassador to the United States. With a line-up like that, it promises to be an inspiring evening!
